Savills’ group chief executive and chairman Jeremy Helsby’s marathon 39-year tenure is close to an end and the company is reshuffling its management in order to position itself for its next phase of growth.
Helsby is stepping down at the end of the year, although he will remain in a consultancy role, focusing on the company’s US business.
He is being replaced by Mark Ridley, the current UK chief executive, who has taken on an interim position as deputy group chief executive until the end of the year.
Ridley is being replaced as UK chief by James Sparrow. Sparrow is stepping up from his role as head of professional services and will be assisted by Richard Rees, who will take on the newly created position of UK managing director.
The moves reflect the growing nature of the business and the increased need for management, while also retaining Rees’s position overseeing the UK’s national development services set-up.
The next generation is aiming to position Savills to advise on helping solve the country’s housing crisis, shape the company’s image away from being “hard-nosed” as well as address the company’s gender pay gap and bring more women into senior roles.
‘Incredible growth’
“It has been an incredible growth story under Jeremy,” says Ridley. “When he joined we weren’t even an international business and now we are a global one. It’s an enormous achievement.
“He brings passion and determination and has always been focused on clients. That is absolutely critical to providing best-quality service.
“He won’t be disappearing into the distance completely though. He will have a continuing role, especially with our US business, as he was the figurehead of that acquisition, he has worked in the US and his relationships are important to us to continue that growth.”
The company has highlighted growth areas that are linked in part to its renowned residential strength.
Rees believes that the company has the right spectrum of expertise to advise clients public and private to bring forward much-needed housing at a faster pace than it is being done in the UK at present. This belief is entrenched in the company’s 2015 purchase of Smiths Gore, which focuses on rural land that could be brought forward for development.
Uniquely placed
“We are uniquely placed to understand the UK housing crisis and feed in with a combination of our property management, development and planning businesses. We can provide a significant supply of housing units for PRS, open housing and indeed affordable housing,” he says.
Smiths Gore is also well placed to advise on the hot logistics sector, advising on where in-demand warehouses could be built on green belt land.
“The huge growth in logistics and big sheds, driven by changes in the retail sector, means Smiths Gore is well placed to deliver sheds and major facilities right the way through the planning and development process,” Sparrow says.
Both Ridley, who was previously head of the Manchester office, and Rees, who headed the company’s Bath and Bristol offices, have strong regional ties and they are adamant that Savills’ network outside London will be crucial in the next year as investors look for value away from the capital. As a result it will continue to look to make strategic acquisitions in the regions, as it did when it bought Birmingham-based GBR Phoenix Beard in 2016.
“Talking to clients on the ground, I note that they feel confident in the HS2 and Commonwealth Games effect and that drive of energy is reflective of many other UK towns and cities,” Rees says.
Consolidation
Consolidation in the advisory sector has been an ongoing theme in recent years, notably through the mergers of Cushman & Wakefield and DTZ, as well as BNP Paribas Real Estate and Strutt & Parker, but Ridley says that he does not see the business as under pressure to undertake corporate transactions to compete at the scale of the likes of CBRE and JLL.
“Those mergers are sometimes for convenience and sometimes for many other reasons, and they do not always yield the best service for your clients or for your people. I think it is more than likely we will row our own boat,” he says.
“We are a global player, increasingly. We are in the top five and are the only UK business in there. In the UK we have doubled our size in the past five years and will continue to increase our exposure. There are many more markets where we have mature businesses but can get a lot bigger too, in Asia, the Middle East and North America.
“We will though continue to look at the likes of Aguirre Newman, [the Iberian business it bought at the end of last year] and find market-leading businesses to buy where we can.”
‘Eat what you kill’
The company has had a long-standing reputation as aggressive deal-doers with an “eat what you kill” remuneration policy. Sparrow says that that has started to change in recent years and that there has been a more collaborative mindset.
“There is a perception that Savills is a free-spirited, entrepreneurial business, and we are proud of that and it is still the case. Historically there has been the view that we’ve been hard-nosed and that there’s been a lack of teamwork but that has changed hugely and the feedback on teamwork from new joiners has been very good.”
Ridley says that in order to implement this in practice, the business has re-organised its structure so it is split into whole divisions working as one on a national basis rather than offices or localised teams and has ensured that there is direct reward for working collaboratively.
“The change allowed us to have a national strategy and this was linked into our European strategy too, so we work cross border. Knowing each other and working together in that structure is an expectation of the company. We want staff to operate within it and have those relationships. We also remunerate to reflect that behaviour,” he adds.
Staying tech-savvy
Like all major property advisers, Savills is striving to keep up and adapt to changes in technology. It holds a regular Dragon’s Den-style internal event for employees throughout the business to pitch new ideas and it was from this that Workthere was created, the company’s business that advises occupiers of flexible and co-working space headed by former graduate Cal Lee.
“The role of the property adviser is evolving and we see tech as an opportunity rather than a threat,” says Sparrow.
“AI and robots will allow us to gather more data quickly and for us that means we need to respond to that challenge and provide the analysis of that data that allows us to give the best advice to our clients,” Rees adds.
Continuing to compete at the top table of property advisory means having a future-proofed workforce, not just in terms of tech-nouse but in terms of its diversity. Like many firms, the company’s top management is all men, bar non-executive director Liz Hewitt, and it is this that needs to be addressed most urgently in order to close its 39% gender pay gap.
“There is a historic gap in the industry in attracting more female talent. That is fundamental to the health of the property industry as a whole and that’s something we are absolutely passionate about addressing. We want to ensure that at school level there are [women] that want to choose a career in property and bring people into property as early as possible,” says Ridley.
Retaining talent
“In the UK certainly our statics are good in terms of bringing in talent but it is about making sure they are staying within the Savills environment and taking on top-level roles. We are very confident we have those people in our business to take on those top roles, including my role, in the future.”
In order to make this happen, the business has been canvassing its female staff about what would make them stay in the business after having a child.
“Promotions to director level has risen to 41% women and we have massively increased the number of women returning to work. That number was very low but it is now up to nearly 95%,” says Sparrow.
“Our understanding from speaking to some of the great women in our business is that they mostly want more flexibility in how and where they work, IT support from home and more coaching and encouragement from all of us in the business. It is an industry challenge, we are responding, but there is lots to do.”
The swashbuckling and male-dominated image of Savills will not be something that changes overnight but it is clearly something that the company’s new management has a sharp focus on addressing.
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